Asset managers' use of benchmarks has been repeatedly called into question recently, amid the emergence of more complicated measures and potential changes to well-established indices.
Perhaps to this end, the CFA Society is set to publish a paper on the subject, focusing on the importance of governance, selection and management processes. The paper notes this topic is particularly important "at a time when there is rapid growth in the development of passive products based on indices, and when there is a proliferation in the range of indices available against which to construct investment products". In the passive space, simple country or sector indices are increasingly being replaced by smart beta benchmarks, which are often not particularly easy to understand. ...
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